When it comes to predicting the future of grocery shopping in New Zealand, we can of course learn from other crises and other markets.
We saw how the GFC drove premium buying in many grocery categories, as shoppers treated themselves at home. We saw how SARS accelerated an irreversible trend toward eCommerce in China. And we know that one constant in times of uncertainty is an inescapable focus on price and value – in every market.
The question every retailer and supplier in New Zealand is asking themselves right now is “where do I invest”?
Understanding today’s shopper trends - what’s likely temporary and what’s likely here to stay - is vital.
Ahead of the Winning the New Zealand Grocery Shopper webinar on 15 September, here are some trends Shopper Intelligence is seeing right now across the store, those we think are temporary and those we predict are here to stay:
Trends likely to be temporary
It’s no surprise that since the COVID shock, Kiwi shoppers are planning more and brand loyalty declined.
Each of these metrics have been trending in the opposite direction in the last five years. But during COVID-19 the trends have reversed.
We had to plan our meals because we weren’t allowed to eat out.
It makes sense that shoppers would have planned more due to the restrictions – but that planning appears to have been more on value/price considerations.
We predict a reversal of these trends in the ‘new normal’, however that’s not to say brands will regain the customers they lost in the shock.
There will be a permanent brand switch for shoppers in particular categories, which is why it's essential for suppliers to know the role their brand will play for retailers in the future.
Trends likely here to stay
Experiential factors – particularly Innovation, Enjoyment and New Zealand Made - spiked in importance after COVID.
Given the scale of the restrictions we faced, the grocery trip became the highlight of our weeks during lockdown. The experience became far more important as a result.
The COVID shock exacerbated an existing trend, that Kiwi shoppers are increasingly searching out experiential, brand led factors in products. And we believe this trend is here to stay.
It’s essential that brands find out which of these five experiential factors matter most to shoppers in their categories and deliver great experiences to drive spend.
There are two shopper trends we believe may have a long-term impact, the first being increased willingness to try private label. As we know, many categories suffered from ‘panic buying’, so shoppers were likely moved into PL products they hadn’t tried before.
[Notice the much higher proportion for Countdown? A recent LinkedIn poll I ran showed the vast majority of you think Countdown shoppers are apparently more open to Private Label because they don't actually know Pams is a PL brand!]
What if shoppers stuck with their lockdown choices because their expectations were met? This poses a very real threat to brands, who may experience a shock walking into their next range review.
The second trend that may result in a longer-term impact, is that new products were more able to drive incremental spend.
Out of stocks clearly played a role in people willing to try new products they hadn’t seen before. But this was also a time for experimentation, as shoppers cooked more meals at home instead of eating out.
As lockdown and the financial impact of COVID eases for shoppers, we may see this trend reverse – although the ability of brands to prove they can deliver on what shoppers want will be key to keeping their products on shelves in the months ahead.
Take a deeper dive on the key grocery trends in NZ on Tuesday 15 September at the Winning the New Zealand Grocery Shopper webinar! Register here >>
Andrew Arnold, Senior Insights Director, Shopper Intelligence NZ
Andrew leads the New Zealand business at Shopper Intelligence, helping suppliers and retailers put the shopper at the heart of the conversation.
With 20 years’ experience in NZ FMCG, Andrew has worked in a variety of sales and insights roles with the likes of Red Bull, Gordon & Gotch and Energizer. During his career he has led sales and insights teams to develop insight led strategies that drive both retailer and category growth.